Remove VMWare tools from the virtual machine. (VMWare tools are incompatible with VPCs.)

Run sysprep on the virtual machine. (This removes hardware-specific information. Supposedly, the newer Windows OS’s are hardware-independent, and do not require this step, but I could not find an references to people who did it successfully without running Sysprep.)

Copy the virtual disks (VMDKs).

Convert the VMDKs to VHD files. There are a number of tools which claim to be able to do this. The one I found that actually completed the process is the StarWind converter.

Create a new VPC and use the VHD files.

On another note, the Windows 7 virtual PC requires a certain level of processor.